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On average, CDs — which promise a fixed rate for a deposit held for a specified period (like six months, one year or five years) — haven’t done much better than savings accounts at outrunning inflation lately.

A one-year CD in January 2021 offered a measly average return of 0.21% for the first year, and if a saver reinvested their balance in January 2022 after it matured, that same account was still paying a meager rate — in fact, a slightly lower one, at 0.15%, according to Bankrate data.

The Fed began its rate hikes in 2022, allowing the average one-year CD rate to rise to 1.41% by January 2023. This year, some banks have been offering 5% rates on 12-month CDs, well above the national average.

After twice reinvesting that $1,000 plus each year’s interest in a 12-month CD since the start of 2021, a saver’s balance would have grown to $1,011.79. But adjusted for inflation, the sum is worth only $862.03 in 2021 dollars, for a loss of $137.97 in purchasing power.

One of the few commonplace inflation-beating strategies would have been to invest in an exchange-traded fund (ETF) that tracks the S&P 500 stock index. That way, a $1,000 investment in January 2021 would have grown to $1,218.49 as of this August, netting a $218.49 return. That’s $1,038.14 adjusted for inflation — a $38.14 gain.

Short-term gains in the stock market are hardly guaranteed, since valuations fluctuate so much day to day. (The S&P 500 has fallen since August, the end point of this analysis because inflation data isn’t yet available for September.) But zoom out over at least 20 years, and stock market gains appear to offer among the most attractive returns — assuming the trend continues and you’re willing to stomach some volatility, said Goodwin.

“On any one-year time frame, it’s highly uncertain that the investor will have positive returns on an inflation-adjusted basis,” she said. However, “as you extend your time horizon — five years, 10 years, 20 years — the longer you are invested [in the stock market], the more overwhelmingly likely you are to have positive inflation-adjusted returns.”

Of course, some people may need access to their savings sooner or live on fixed incomes that don’t leave much room for weathering the market’s ups and downs over a long period. It’s often helpful to consult a financial planner, if possible, to tailor your savings strategy to your own situation.

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